The government shouldn’t bail anyone out of their mortgage

April 27, 2008

Some people never learn. A few liberal members of Congress are demonstrating that in their reaction to the so-called “subprime crisis” involving mortgage loans.

Sen. Christopher Dodd, D-Conn., is urging his colleagues to help homeowners who are having trouble paying off their mortgage loans. Dodd’s recommendation is that lenders be encouraged to offer new, more affordable mortgages, with backing from the Federal Housing Administration.

“More affordable” mortgages — handled imprudently — are precisely what created the problem.

Too many borrowers were offered — and took — loans with exceedingly liberal terms. Minimal or no down payments, failure to ensure that borrowers could make payments and similar efforts to make mortgages “affordable” resulted in a meltdown.

Some people never learn — or, perhaps, they do learn but are tempted to ignore lessons in the hope of gaining votes during an election year. Taxpayers should not have to foot the bill for such irresponsibility.